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Question: What do you think is true about economic inflation? Inflation is...
Theft - 23 (39%)
Free Money - 2 (3.4%)
Growth - 3 (5.1%)
Debasement - 11 (18.6%)
Necessary - 9 (15.3%)
None of the above. - 4 (6.8%)
A tax. - 7 (11.9%)
Total Voters: 57

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chodpaba (OP)
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March 23, 2011, 10:23:32 PM
Last edit: March 20, 2012, 01:27:04 AM by chodpaba
 #1

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March 23, 2011, 10:56:19 PM
 #2

Can I say "none of the above?" Inflation is just something that happens.

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March 23, 2011, 11:17:01 PM
 #3

Can I say "none of the above?" Inflation is just something that happens.

It happens in the case of fiat money because of deliberate actions by certain people. To dismiss it as something that just happens is the same as avoiding judgment on violence, corporate fraud, or wasteful government programs.
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March 23, 2011, 11:47:21 PM
 #4

It's invisible transfer of wealth from savers to those who get to use the new money first which is theft pure and simple.

In my opinion it's the biggest evil known to mankind besides central banking and fractional reserve banking.

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March 24, 2011, 01:39:43 AM
 #5


... baked into the fiat-debt slave monetary system.

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March 24, 2011, 07:08:21 AM
 #6

Well, the question is really general. It's not "Why is inflation happening right now?" or "Why does inflation happen under fiat money systems?" or even "Is inflation good or bad?"

Instead it's just "Inflation is..." and the only answer I can give is "...a reduction in the buying power of a currency."

When the value of gold decreases relative to that of silver (as it has been lately), this is a kind of inflation as far as anyone using gold as a currency is concerned. Which of your poll options is the reason for that?

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March 24, 2011, 09:00:55 AM
 #7

Monetary inflation is a relic, necessitated by the limits of physical money, namely that it cannot be infinitely divided.

In so much as it is not distributed equitably, it is debasement and theft.

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March 24, 2011, 09:16:59 AM
 #8

I voted "debasement".

"Theft" is a bit too hard a word, imo.

Inflation is theft only if you hoard cash during long period of time.  Very few people do that, precisely because they are aware of inflation.


Also:  gold exists (and so does bitcoin, now).

So there is no way inflation can steal you any significative fraction of your wealth, unless you are very financially unwise.


PS.  You could have added "Tax" as a possible choice for your poll.

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March 24, 2011, 02:11:38 PM
 #9

I voted "debasement".

"Theft" is a bit too hard a word, imo.

Inflation is theft only if you hoard cash during long period of time.  Very few people do that, precisely because they are aware of inflation.


When someone breaks into a house and takes away stuff it is burglary. If someone breaks into a  house where owner have installed better locks and doors and than takes stuff it is still a burglary. Logically, therefore if my first sentence is true, than your assertion is incorrect and we have to conclude that inflation is indeed a form of theft, it is just those how try to protect themselves lose a little less to this theft.


I agree. Just because there are steps you can take to stop or reduce theft to your stuff doesn't mean it isn't theft if it happens to others.

And tax is on the list. Hint: it's just a particular type of theft.

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March 24, 2011, 02:19:20 PM
 #10

I agree with planned inflation being a tax. I'm not really sure whether my opinion is best represented as "Tax is often theft but doesn't have to be" and "Tax is theft, but theft is okay sometimes."

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March 24, 2011, 02:38:21 PM
 #11

And tax is on the list. Hint: it's just a particular type of theft.

Yup, just added it.

haha, I meant no need to add, I already see it on the list, it was hiding inside the word 'theft'


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March 24, 2011, 02:58:34 PM
 #12

in the current economy, it's necessary, but must be kept fairly low.  my country experimented with zero inflation back in the 80s.  it didn't work well.
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March 24, 2011, 04:11:44 PM
 #13

in the current economy, it's necessary, but must be kept fairly low.  my country experimented with zero inflation back in the 80s.  it didn't work well.

Inflation is not at all necessary, anywhere. Which is your country? Japan?
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March 24, 2011, 04:17:25 PM
 #14

in the current economy, it's necessary, but must be kept fairly low.  my country experimented with zero inflation back in the 80s.  it didn't work well.

Inflation is not at all necessary, anywhere. Which is your country? Japan?

Inflation is absolutely necessary, depending on the products and population. The rate of inflation and deflation can be argued. But we all consume resources, if even only food were in existence, the cost of that food depends on the amount of food available in proportion to the amount of people consuming it. This is the case with renewable resources. Technically all resources are renewable, but we can't wait around for them to be "renewed". I.E. Oil in another billion years or so will be renewed.


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March 24, 2011, 04:30:12 PM
 #15

in the current economy, it's necessary, but must be kept fairly low.  my country experimented with zero inflation back in the 80s.  it didn't work well.

Inflation is not at all necessary, anywhere. Which is your country? Japan?

Canada, and i specified "in the current economy".

The bank of canada tried a zero inflation policy from 1988 until 1993.  the result was vastly increased unemployment (unemployment went past 11%.  compare a peak of 8.7% during the recent economic unpleasantness), minimal GDP growth, and increased government deficits and debt (due to reduced tax revenues).
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March 24, 2011, 04:31:58 PM
 #16

That's because your economy has already been damaged by over government involvement.
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March 24, 2011, 04:32:02 PM
 #17

Inflation is absolutely necessary, depending on the products and population. The rate of inflation and deflation can be argued. But we all consume resources, if even only food were in existence, the cost of that food depends on the amount of food available in proportion to the amount of people consuming it.

??
Inflation == creating new money != price fluctuations.
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March 24, 2011, 04:41:07 PM
 #18

Inflation is absolutely necessary, depending on the products and population. The rate of inflation and deflation can be argued. But we all consume resources, if even only food were in existence, the cost of that food depends on the amount of food available in proportion to the amount of people consuming it. This is the case with renewable resources. Technically all resources are renewable, but we can't wait around for them to be "renewed". I.E. Oil in another billion years or so will be renewed.

This is a nonsense. In an economy without a legal tender or government supported currency, the free market would inevitable select money that don't lose their value.


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March 24, 2011, 04:43:33 PM
 #19

Inflation is absolutely necessary, depending on the products and population. The rate of inflation and deflation can be argued. But we all consume resources, if even only food were in existence, the cost of that food depends on the amount of food available in proportion to the amount of people consuming it. This is the case with renewable resources. Technically all resources are renewable, but we can't wait around for them to be "renewed". I.E. Oil in another billion years or so will be renewed.

Yeah rigth, and the solution to this, is to print some numbers on some pieces of paper.  Seriously I don't understand your way of thinking.  At all.  What am I missing?

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March 24, 2011, 04:44:51 PM
 #20

Inflation is not at all necessary, anywhere. Which is your country? Japan?

Canada, and i specified "in the current economy".

And I specified "nowhere". Wink

The bank of canada tried a zero inflation policy from 1988 until 1993.  the result was vastly increased unemployment (unemployment went past 11%.  compare a peak of 8.7% during the recent economic unpleasantness), minimal GDP growth, and increased government deficits and debt (due to reduced tax revenues).

Unemployment = labor laws fault, particularly if they make it illegal to decrease wages.

Minimal GDP growth = don't know enough about the case, but remember that GDP measures consumption not production (monetary stability stimulates savings, not consumption, and that's good). And, well, if the amount of money is stable, the GDP, measured in this money, would not increase much either. People would keep spending the same amount of money, it would just be worth more. Not sure GDP statisticians really take that into account when announcing growth numbers.

Increased government deficits = that's because they couldn't finance themselves with inflation. It's pretty much what happened to Japan. The central bank was kind of responsible (well, less irresponsible than others) for quite a long time, but the executive branch of the government was very "Keynesian", spending like crazy, accumulating a huge debt. Anyway, that's government's fault, obviously, not monetary stability's fault.
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March 24, 2011, 05:03:23 PM
 #21


The problem is that the debt-based economy was designed to maximize growth... Not for sustainability.


Extraordinary growth and sustainability is not mutually exclusive things, especially when you look in the long run.

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March 24, 2011, 05:09:55 PM
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That has been the whole problem with an economy that requires ever increasing growth to operate, like an economy dependent on debt-backed currency. The rate of inflation required tries to drive the rate of resource extraction,

No, it doesnt.

Quote
but it can not do this once that rate becomes unsustainable, as it has now become. In this case the entire economic system that is dependent on that arbitrary rate of inflation than becomes unsustainable itself.

The problem is that the debt-based economy was designed to maximize growth... Not for sustainability.

Wrong again. The central bank system (which is what I am guessing you mean by debt-based economy) creates discoordination in the economy and stops growth. It creates malinvestments and crisis.

If by growth you mean an increase on the GDP then yes, inflating away and then reporting a funny CPI will increase the GDP. But increase in GDP does not mean growth. GDP reports economic activity, not growth.

Quote
Such is the folly of short-sighted capitalists, that they would sacrifice perpetual profits (sustainability) for short-term profits.

err... The central bank is a central planning system. Even Karl Marx advocated a central bank.

Quote
Now, when it comes to economies that are coupled with different rates of inflation (like Japan and the U.S.) then capital will tend to flow to the economy with the higher inflation rate.

Why? I dont see why. Germany has had strong currency compared to the rest of the world and has built a lot of capital.

Quote
Notice, I said 'capital' not 'wealth'. This is because 'wealth' depends on the ultimate value of that 'capital'. This would happen in the form of Japan purchasing U.S. debts that pay a higher interest rate than Japanese debts. In the short term this results in a flow of capital from Japan to the U.S. The danger is that the U.S. could just say "I think I will just keep those peanuts" and choose not to pay it back, which would be a sucker deal for the Japanese. But this would also result in the U.S. having to pay higher interest rates, which would require issuing more capital (quantitative easing) and feed into a hyperinflationary scenario (unsustainable).

Never mind, you are using capital as money, not as machines and objects that help produce stuff.

And yes, when governments start messing and centrally planning the currencies bad things happen.

Quote
In the short term it looks like a raw deal for the Japanese, but in the longer term they end up with a more stable economy (sustainable) even though it may temporarily grow at a slower rate. Standing pat is not a bad thing if the alternative is collapse...

Again, increase in GDP does not mean more growth.


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March 24, 2011, 05:24:44 PM
 #23

And yes, when governments start messing and centrally planning the currencies bad things happen.

And when they don't, equally bad things happen.

completely centralized and completely decentralized economies are both bad things, but there is a good balance somewhere in the middle.
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March 24, 2011, 05:27:45 PM
 #24

And yes, when governments start messing and centrally planning the currencies bad things happen.

And when they don't, equally bad things happen.

completely centralized and completely decentralized economies are both bad things, but there is a good balance somewhere in the middle.

Please, lets keep a sane debate. The middle point is not an argument. If it were slavery would still be around because you dont want to completely remove slavery, you want to find a good balance somwhere in the middle, right?  Roll Eyes

Governments messing in the currency markets have always created problems and poverty.

And please, from the previous comments, always remember that increase in GDP is an increase in economic activity, not necesarely growth.


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March 24, 2011, 05:29:25 PM
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By 'long run' do you mean 100 years, or 1000 years?

Steady growth adds up. Boom and bust cancel each other out.

2% growth each year is like a compound interest rate.

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March 24, 2011, 06:45:27 PM
 #26

Inflation is absolutely necessary, depending on the products and population. The rate of inflation and deflation can be argued. But we all consume resources, if even only food were in existence, the cost of that food depends on the amount of food available in proportion to the amount of people consuming it. This is the case with renewable resources. Technically all resources are renewable, but we can't wait around for them to be "renewed". I.E. Oil in another billion years or so will be renewed.

Yeah rigth, and the solution to this, is to print some numbers on some pieces of paper.  Seriously I don't understand your way of thinking.  At all.  What am I missing?


It doesn't matter what currency system one uses (paper, gold, seashells). It is simple Supply/Demand that causes true Inflation/Deflation.

Quantitative Easing (Printing more money) is a form of False Inflation, that in the end means nothing because it equals out quickly. At first in QE, the products price goes up because the value of the money went down. But then the product prices must come down (deflation) in order for people to buy them. This False inflation/deflation just buys time. Meanwhile the true inflation is simple supply/demand.

Everyone is for increasing the minimum wage, but think about it. I will run for public office, tell all the working class that I am for a minimum wage of $25 /hr.  All of the working class will love me. But over a period of 3-12 months the cost of all products goes up to reflect everyone getting paid more.

It sounds good, and people are for it, and initially it works, but after adjustment everyone is back to where the were. The true supply and demand costs of products.

Want proof; How many BitCoins will you give me for a pound of "dirt"?   Now, How many BitCoins will you give me for a pound of Gold?


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March 24, 2011, 07:06:49 PM
 #27

It is not that complicated... Please follow along.

In a debt-based economy there must always be more money owed than is in circulation, otherwise there would be no money.

No. Even if you count government debt at the central bank as real debt (in reality its not), you have as much money as debt in circulation.

Quote
Since this is true the only way to keep it going is to continually accelerate the rate of growth of the economy...

Even accepting the previous as true (its not), I dont see how "the only way to keep this going is to continually accelerate the rate of growth of the economy"... I dont really understand what this sentence mean.

Quote
Because that is how all Ponzi schemes perpetuate. Once the rate of injection into this type of economy slows down it can quickly collapse. This injection comes in the form of actual physical resources that have to be extracted.

Huh I dont understand what you are saying. Injecting physical resources?!?

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It requires energy to extract these resources. The problem is, that over time, as you extract the resources that are easiest first, it costs more and more in terms of energy to extract those resources. You reach a point of diminishing returns. At some point, the rate at which you inject new value into the economy is slower than is required to keep a debt-based economy running.

No. The reason why the inflationary cycle becomes unsustainable is because the distortion in the capital structure create inefficiencies and malinvestment. As the system becomes less and less efficient at the end the system collapses.

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Interest rates get lower and lower (diminishing returns), and it eventually stops working.

Interest rates go down as a way to keep the malinvestments that the inflationary cycle created going (that obviously produces diminishing returns). It has nothing to do with diminishing returns from resources or technologic advances. There were economists some decades ago trying to relate business cycles with technology changes but it was a complete failure, basically because they are not really related.

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In order to keep the engine running (so to speak) Keynesians rely upon the 'business cycle'... Which is to say, periodically pulling away from the brink of unsustainability, that is until there is eventually a brink you can not pull away from. This also acts as a means to make massive transfers of wealth from those that have access to few financial markets to those few that have access to all financial markets.

Yes, this is absolutely true. Although I am not sure if keynesians in general know what they are doing or are just completely clueless and the whole thing just blows up because its not sustainable. Maybe some at the top know, there really is no way to tell.


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"discoordination in the economy and stops growth" is just another way to say 'not sustainable'.

I think we kind of agree but the problem is how you use the word "growth".

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I never mentioned GDP. GDP is expressed in units of the currency for the economy in question, and as such is not really an objective measure. IMO it wold be best to represent such growth in terms of total resources consumed versus total resources produced... But economists generally refuse to track metrics that tell the truth.

From how you are using the word growth it really seems you mean GDP. How do you define growth?

It would be interesting to have statistics in terms of real resources and not money. But it is impossible or extremely difficult; its not that someone is trying to avoid that type of analysis. How do you clasify objects?. Imagine only the computer industry. How many types of computer do you report? If you aggregate too much you are loosing valuable information, if you dont the data becomes unmanageable. That is why the price system works. The problem is that the price system is so completely distorted by the monetary manipulations of the governments that it just becomes too dificult to know what changes come from supply and demand of the goods and what part comes from monetary manipulation. It is a big issue.

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Part of the reason that the German economy is still strong is that Angela Merkel clamped down on foolish derivatives trading which would have resulted in higher inflation. It will not continue to be strong unless it de-couples itself to some extent from the EU economy.

While I agree that in some way it would be good for Germany to decouple from the euro (it has the problem that it loses a big market that controls), the other part is just not true. The Germany economy has always been strong, way before the derivatives growth. Since Weimar and the National Socialists, the germans have always had a strong currency policy that has allowed them to build industry.

The reason why a strong and stable currency helps to build industry is simple. Inflationary monetary systems distort the natural interest rates and produce a series of malinvestments. While the manipulation goes on this investments appear profitable (this is the bubble), but then they come crashing down and they reveal as malinvestment and waste. Now this is a lost opportunity and wasted resources, that could have been dedicated to built a sustainable industry. In the short run inflationary countries can give the appareance of growth, because of all the econimic activity of the bubble, but in the medium and long run its ruinous.

I would point out that the currency that Germany is using now is the Euro...

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Yes, that is the 'Capital' in 'Capitalism'.

Capital is defined as the goods that help create other goods. For example, a shovel is a capital good. It helps you produce other stuff. Its not the stuff you want to consume. This definition is the traditional definition. Even Karl Marx uses this definition.

But in the financial circles because they only see money, capital has started refering to money, and this has moved onto some economists. But the definition of capital is stuff that helps you produce other stuff. Money, except in the financial world, is not strictly capital.

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And yes, when governments start messing and centrally planning the currencies bad things happen.

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Can you explain to me how the Bitcoin algorithm is not 'central planning'?

I dont really see the connection. Central planning means organizing the production of a society. How is the Bitcoin algorithm central planning?

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Again, GDP = fictitious metric.

Its not really ficticious, it measures economic activity, but it can be distorted if the price system is distorted.

But I really think you are using the word growth as increase in the GDP. I would like to know your exact definition of growth.


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March 24, 2011, 07:30:01 PM
 #28

But lets assume that One Company has a monopoly on all products. They can control the Supply. Sort of like the Debeers argument.

While it is true if one owns a resource they can control the Supply (like OPEC), but they have no control over the Demand. If, even in a monopoly, they charge to much, people won't buy it. So the monopoly must lower a price to a point at which people will buy it and there is a profit. Even in a Monopoly there is supply and demand.

Now lets extend it to something people must buy. A company has a monopoly on all food products. They raise prices to a point to suck all the money possible out of people. But then the people that die from starvation because they can no longer afford to buy food, the company then has less customers and must increase prices again, and again, and again.  It is in the companies best interest to put a price on the food that as many people as possible can afford and not affect them negatively. Even with their monopoly.

The above wouldn't work anyways because people would switch to growing and gathering their own food before they reach that point, which would also be in the companies worst interest.

So, Inflation/Deflation comes down to simple Supply/Demand rules:

Increasing Population : Steady or Decreasing Resources = Inflation

Increasing Population : Growing Resources = Price set at ration between Population and Resource Growth Rate.

Steady Population : Decreasing Resources = Inflation

Steady Population : Increasing Resources = Deflation

Declining Population : Increasing Resources = Deflation

Declining Population : Growing Resources = Deflation

Ideally the best possible position is maintaining a Population Level = Resource Level. <--- That will eventually cause wars. Who gets to live and who has to die when the Population Level gets higher than the Resource Level.

Tricks used in monetary systems (like printing more money, or taking money out of the market) only delay a problem not solve the problem. Doing so, BTW, causes a big problem that must be corrected.

The ability to Print more money caused a problem that must now be corrected, it won't be pretty. There are to many people in the world.

When the world was on a Gold Standard or some system of money that held intrinsic value, there was a unique correlation between the world Population and Resources. Population remained in check to the resources to support that population. Look up population rates through a timeline. You will see something interesting.

Now, we print more money and more and more to delay the problem and allow the population to grow even when it shouldn't have. We have delayed a natural event. So currently, there is over population compared to available resources. Hence, inflation will occur, compounded by Quantitative Easing of the Dollar. But the U.S. is lucky because we can create our own food. A lot of other countries can not. Inflation will hurt them more. They will die off. Sorry just a fact. But they won't die from starvation, they will die from wars fought to gain others resources. It has already started.

Inflation is here to stay awhile, until the population reaches a point at which available resources can supply it.






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March 24, 2011, 09:25:38 PM
 #29


For all the inflationistas, they great thing about crypto-currencies is that you can go ahead and make your own one, that inflates, deflates or blows up spectacularly after a pre-determined period.

Go ahead put your best crypto-currency forward and let the market decide.

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March 24, 2011, 10:10:16 PM
 #30

this thread is like watching a schoolyard fight between rival schools.  We've got the monetarists, the austrians, the keynesians, and the neoclassicals all duking it out in a massive melee over which way cause and effect go with inflation, among other things.

Ideally the best possible position is maintaining a Population Level = Resource Level. <--- That will eventually cause wars. Who gets to live and who has to die when the Population Level gets higher than the Resource Level.

When the world was on a Gold Standard or some system of money that held intrinsic value, there was a unique correlation between the world Population and Resources. Population remained in check to the resources to support that population. Look up population rates through a timeline. You will see something interesting.

Now, we print more money and more and more to delay the problem and allow the population to grow even when it shouldn't have. We have delayed a natural event. So currently, there is over population compared to available resources. Hence, inflation will occur, compounded by Quantitative Easing of the Dollar. But the U.S. is lucky because we can create our own food. A lot of other countries can not. Inflation will hurt them more. They will die off. Sorry just a fact. But they won't die from starvation, they will die from wars fought to gain others resources. It has already started.

Inflation is here to stay awhile, until the population reaches a point at which available resources can supply it.

I do not get the relationship you propose.  population == resource would prevent wars, assuming relatively equal distribution

also, the relatively recent population explosion started long before the gold standard was abandoned.  Futhermore, population growth has been falling for decades (UN projections show that at current rates, population growth will stop in about 40 years) while economic growth and inflation continue apace.

food and other vital products are tricky economically as a dissymmetry is desirable.  you want food to be cheap, so everyone can afford to eat, but you also need food to be expensive enough to be profitable enough to encourage farmers to produce enough.  therefore, you create subsidies to allow that, fueled via taxes (bitcoin operates on the same principle, with the current block subsidies, then later transaction fees, to encourage people to provide the processing power to run the system).  though this breaks down somewhat if not everyone agrees to do this or agrees on how much to do this.

there is no problem with available resources, at least on a high level.  the problem is with the distribution of the resources, which is available resources on a local level.

i agree with you on the last point.  a steady state economy with zero population growth is the logical end result at some point, but where that point is depends on to what degree the technological optimists and decouplers are correct.
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March 25, 2011, 02:37:07 PM
 #31

chodpoba,

  You seem reasonable and rational. While I disagree with some, there is a point in which debate and compromise can be reached through logical non-emotional debate. This is what we need, not emotional, irrational, and nutty debate.


Quote
There is no correlation between a 'gold standard' and economic stability. Even while the U.S. was on a 'gold standard' we still suffered the throes of the 'business cycle' because of fractional reserve lending, which gives is tiered money. Even today there is no possibility of 'returning' to gold because there never was enough gold to back the currency without fractional reserve, and there certainly isn't now.

The correlation, is in corrective forces upon time to correction. We have learned how to prolong and/or increase our agony.

Lets look at the basics. The increase in population, like any animal population, is due to an increase in available resources (food).  These resource must be maintained and distributed at the same level to maintain the population. Oil affects the distribution and cost of food.

But there is a direct correlation between resources and population. Non-intrinsic value money systems lets one hide (for a time) changes in the system. It is believed that on a gold standard, things will go wrong (as they always will at some point), but the correction is sharp, painful, and quick. We fear inflation and try to stop it, that is our error. Inflation is not bad, it is a foreboding. It is a correcting mechanism. We try to maintain the price of Oil to "acceptable" prices. When we should let it run wild. Let go to $200 or more per barrel.

I like deflation but understand why governments fear that more than inflation. Deflation will break the financial models that systems are built upon. But for the general population, it is in the end a good thing. Yea, it hurts as people get laid off but did we really think we were above Natural Laws.

But I will make a prediction base off of some simple theories that have been used in natural systems. We will see hyper-inflation within 5 years, followed by deflation, in fighting among our species for resources, and have it start all over again.

The "Reset Button" is about to be pushed.

Money will return to an intrinsic value system (Utah is preparing) <- That doesn't surprise me considering the religion. It is easier for the "average" person to gauge the status of the financial system. Using the "Trust Me" model ends up with great corruption and misuse because its "free money" and very, very, complicated scams to steal money.

One "flaw" in modern monetary systems is compounding interest, that could not exist in an intrinsic value system for any length of time. Compounding interest will eat all reserves of money over time, but that would not be possible with Gold, Platinum, etc.... The only way to support compounding interest is by increasing the "amount in circulation" of paper money or in other words devalue the money(QE).

IMHO, The only purpose of "Banks" should be to physically protect ones money and assist in the transferring of "money" from one point to another for an announced fee for said services. Any "loans" that a bank makes should come from money the Bank has saved, not the money other people have saved, if the bank decides to "loan" money. Currently they use everyone else's money to invest in what ever they see fit without any consideration to their depositors. The only reason people go along with it is because of FDIC (technically making every taxpayer a depositor in every bank).

Population is the key to all systems. A basic foundation.

From 10,000 BC at 1 million to now at 5 Billion, the graph is not linear as one might expect but progressive. Almost equalling a logarithmic scale. Calculations have shown in 2050, the population will surpass resources. <-- Big problem.  2 ticks in the chart are energy production and monetary systems.

But our growth came at a cost in "Adaptive Space", we have been to successful. Nature is balancing out the problem through selection. Nature is crewel in its punishment. It lets one species punish itself if to successful by the elimination of other species and disease. As our species grew, other species declined at an inverse to our growth.

So one of the most "intelligent" species to ever existed is killing itself. Should have eaten from the Tree of Life, instead.  Grin


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March 25, 2011, 04:59:23 PM
 #32

From 10,000 BC at 1 million to now at 5 Billion, the graph is not linear as one might expect but progressive. Almost equalling a logarithmic scale. Calculations have shown in 2050, the population will surpass resources. <-- Big problem.  2 ticks in the chart are energy production and monetary systems.

"Calculations have shown in 2050, the population will surpass resource".  who's calculations?  surpass what resources?  everywhere or locally?

furthermore, your figures are out of date.  current population is a bit past 7 billion

currently, population growth is slowing and has been for decades.

by 2050, the population is likely to hit 9 billion, and at current trends, population growth at that point will be nearly 0.

here's my source : http://www.un.org/esa/population/publications/longrange2/WorldPop2300final.pdf

where's your's?
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March 25, 2011, 05:04:15 PM
 #33

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The concept that human population is due to an increase in available food sources is a basic misconception, the causes of population instability are actually a lot more complex than that. The single overriding factor causing the rapid increase in human population since the beginning of the industrial revolution has been an increase in longevity due to achieving an understanding of disease processes.

It is a fundamental of life, it is the foundation. Eat and Propagate

Increase length of life based on science is a secondary cause, you might have the technology to promote a life for 200 years but if you don't feed that person, What is his life expectancy?  30 days or so.

The foundation of all life expectancy is the ability to eat. Take that away and nothing else matters. It is the foundation.

The increase in available resources comes at a cost of Adaptive Space, which comes back around and bites us in the butt.

For example: you can catch every fish in the sea and increase food resources to support the population, but then all the fish are gone. What next?

A balance must be maintained, we are smart enough to know, but not willing enough to enforce it. Its to late anyway. But alas, nature will balance it out for us.


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March 25, 2011, 05:20:52 PM
 #34

From 10,000 BC at 1 million to now at 5 Billion, the graph is not linear as one might expect but progressive. Almost equalling a logarithmic scale. Calculations have shown in 2050, the population will surpass resources. <-- Big problem.  2 ticks in the chart are energy production and monetary systems.

"Calculations have shown in 2050, the population will surpass resource".  who's calculations?  surpass what resources?  everywhere or locally?

furthermore, your figures are out of date.  current population is a bit past 7 billion

currently, population growth is slowing and has been for decades.

by 2050, the population is likely to hit 9 billion, and at current trends, population growth at that point will be nearly 0.

here's my source : http://www.un.org/esa/population/publications/longrange2/WorldPop2300final.pdf

where's your's?

Granted I usually quote a 5 Billion figure, 7 Billion is OK.

I can show many sources for population growth, but lets just deal with math.

As shown, inflation can not be sustained indefinitely even at 2% growth. Simple math over time.

Now lets replace Inflation with Population.

A population needs resources in food to grow and maintain growth.  So as population grows resources dwindle, to a point of slowing to 0.  As you have pointed out.

Now, what happens. Do you think at that point a balance has been achieved?  In reality it has been over achieved. Resources in food will dwindle as will the population. The down side of the graph is very, very painful. Because people just don't say we wont eat. They will over utilize every resource to a point of destruction.  When hungry, will people let fish live for others, will they let farm land lay still for a year and rotate it, for re-netruilization?

No, they will use as much of it as possible to survive, at the cost of not surviving.

This has been shown in studies of overfishing. Fishermen will over fish their own resource in order to survive and then complain there is not enough fish to support them. *BTW There is an exception to this with Lobster Fishermen, they put cameras in the traps to find out why the Lobster Catch rate has maintained a certain level. Come to find out, the Lobster trap is an inefficient method of catching lobsters. A lot of the Lobsters get away. In other words, we only catch a small percentage of them, and thus the market remains steady.

Sources:

http://overfishing.org/

http://www.overpopulation.org/

http://query.nytimes.com/gst/fullpage.html?res=9A01EFD61438F934A35757C0A963948260

Or just google, Over Fishing, Over Farming, Over Population, etc....  

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March 25, 2011, 05:50:51 PM
 #35

Quote
By that logic then, the increase in food production lags population growth instead of causing it. It should be possible then to get ahead of the problem by addressing population growth.

In a way, I agree. Remember the two basics though, Eat and Propagate, the need for food, will not replace the need for Propagation. If a species is alive to Propagate, they will propagate. You will see this even in areas of great famine, i.e. parts of Africa. Even though they themselves can't eat and many die of starvation, they will continue to propagate. I believe this is natures way of buying time, and natural selection. There might not be enough to eat now, but if you have a lot of progeny some of them might be able to survive. Sort of like the light bulb burns brightest before it goes out. The time scale is what is elusive. Pinning down when these points are reached needs to be quantified.

I believe the Lagging effect is due to the implementation of monetary systems, rather than direct food production. Most people buy food and don't grow or get it themselves anymore. So, when population grows, food production will go up after the fact. But that is not unusual, food production will always lag population, even when "profits" are involved. Just at different rates.

People don't grow food for the fun of growing food.(Macro Scale)

We tend to look at our system only from "Our" perspective. What it takes for us to survive? Not for others. Remember, we are a food source for others in the system. Assume the elimination of all "animals". A great die off. There are species that will take advantage of that Adaptive Space. Bacteria, Viruses, etc...  A "Reset Button."

We are unique in being granted dominion over every other living thing. If we don't manage it well, there is a cost. 

We are unique life forms, not special life forms.   Nature abhors, Arrogance.


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March 25, 2011, 05:55:10 PM
 #36

Most people buy food and don't grow or get it themselves anymore. So, when population grows, food production will go up after the fact. But that is not unusual, food production will always lag population, even when "profits" are involved. Just at different rates.

Competition and innovation may increase food production faster than population growth.
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March 25, 2011, 06:15:19 PM
 #37

I can show many sources for population growth, but lets just deal with math.

As shown, inflation can not be sustained indefinitely even at 2% growth. Simple math over time.

Now lets replace Inflation with Population.

A population needs resources in food to grow and maintain growth.  So as population grows resources dwindle, to a point of slowing to 0.  As you have pointed out.

Now, what happens. Do you think at that point a balance has been achieved?  In reality it has been over achieved. Resources in food will dwindle as will the population. The down side of the graph is very, very painful. Because people just don't say we wont eat. They will over utilize every resource to a point of destruction.  When hungry, will people let fish live for others, will they let farm land lay still for a year and rotate it, for re-netruilization?

No, they will use as much of it as possible to survive, at the cost of not surviving.

either i'm missing a metaphor here or you're incorrect.

population growth is not at 2%, it's not even at 1% and it's dropping.

the rest of your post assumes population growth will continue apace, which projections i linked to show is not the case, and even your own link agrees with the assessment, barring a second baby boom or us figuring out clinical immortality or something else coming out of left field.

you assume a constant growth until it all crashes apart due to nonsustainable use of resources.  actual data shows a slowing growth, followed by a steady state.

though whether 9 billion is beyond a balance is a different question.

regarding your next post, they continue to propagate because of scarce resources i.e. if i have lots of children, the chances of at least one of them surviving goes up.  the way to counter that is to make the "default" probability of someone surviving to adulthood higher via stability and higher standards of living.  this has been shown to work in europe and north america.  population growth and average standards of living have an inverse relationship.

there's no problem with food production, the problem is food distribution, with where the food is, how much it costs, and how much it costs and how long it takes to move it.
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March 25, 2011, 06:26:43 PM
 #38

I think we are close.

The 2% was given, I think by Vlad, not as population but as Inflation and growth. I was just pointing out that any inflation over time can not be sustained at any positive rate. A good system would have growth and decline at regular intervals.

We agree, Population growth can not be sustained and must slow.

I think where we differ is what happens when it reaches 0 and starts to decline.

Correct me if wrong:

You believe we have achieved a balance at which we can then maintain the level or somewhere near that level.


I believe when we reach zero and start to decline, we have reached a point where over utilization has started to fail, and the slope down will be drastic, not controlled.

When we reach 0, we will have utilized all that we can currently utilize, there wont be fish farms because all the fish in those farms will have been eaten. The Farm Land will begin to fail from over utilization. There will be a drastic decline in production followed by a drastic decline in population.


I also think, that those who best prepared for that time will come out on the other end. Those who can acquire their own resources, and protect them from others, will be the ones left.



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March 25, 2011, 06:31:55 PM
 #39


The problem is that we have reached a point of diminishing returns with inputs... A pound of fertilizer doesn't produce as much as it used to, and the energy cost for that fertilizer is increasing. The issue of food production can no longer be solved by doing more of the same, such innovation will have to provide a quantum increase in output/input to have any substantive effect... I hope it will.

Genetic engineering...making them more efficient in absorbing sunlight...

Perhaps, you could produce muscle cells without the need for cows.

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March 25, 2011, 06:47:02 PM
 #40

Correct me if wrong:

You believe we have achieved a balance at which we can then maintain the level or somewhere near that level.

I believe when we reach zero and start to decline, we have reached a point where over utilization has started to fail, and the slope down will be drastic, not controlled.

When we reach 0, we will have utilized all that we can currently utilize, there wont be fish farms because all the fish in those farms will have been eaten. The Farm Land will begin to fail from over utilization. There will be a drastic decline in production followed by a drastic decline in population.

yes, that is what i am saying more or less.

your view is that we will only stop growth when we run out of resources to maintain that growth, a view which is not backed up by the available data.

in north america and europe, our internal population growth (strictly births-deaths, ignoring immigration/emigration) stopped decades ago.  total fertility rates have been below replacement since the mid-60s and show no signs of going back up.  the only thing maintaining total population growth is immigration, and even that is not keeping up in places.  germany, russia, and japan have been experiencing negative population growth for some time.

there's no current shortage of resources to achieve population growth in these areas, but there is no growth happening.  population decline is preceding a resource decline.
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March 25, 2011, 06:51:19 PM
 #41


The problem is that we have reached a point of diminishing returns with inputs... A pound of fertilizer doesn't produce as much as it used to, and the energy cost for that fertilizer is increasing. The issue of food production can no longer be solved by doing more of the same, such innovation will have to provide a quantum increase in output/input to have any substantive effect... I hope it will.

Genetic engineering...making them more efficient in absorbing sunlight...

Perhaps, you could produce muscle cells without the need for cows.

Not forgoing, unintended consequences. Lets assume we develop all that is physically able to be developed by any means necessary. All that is done, has only delayed the inevitable.

In the past, with growth comes expansion. With that expansion, others gave way to make room. (Adaptive Space). We came to the Americas and Australia and expanded. We will need the Next Adaptive Space. Where do we go? There is no where left. Outer Space? We can't get anywhere in time.

Bison used to be in the millions, but they had to give way for Adaptive Space. As other species had to also do. We are unique, not special.

We forget we are part of a larger greater system. We "think" we can control it. We even made laws.

A thought experiment:

We have laws of ownership. A farmers produce is theirs to do with as they wish. They can sell it, they can let it rot. It is their legal right.

What would happen if all farmers decided to not sell but keep their food for their own and/or local use? Would the rest of the world follow "man's laws" or "Natures Laws"?  I think we know what would happen.

We are the first species to have been given Dominion over every other species. We mucked it up. We must now pay the price.

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March 25, 2011, 06:57:31 PM
 #42

Correct me if wrong:

You believe we have achieved a balance at which we can then maintain the level or somewhere near that level.

I believe when we reach zero and start to decline, we have reached a point where over utilization has started to fail, and the slope down will be drastic, not controlled.

When we reach 0, we will have utilized all that we can currently utilize, there wont be fish farms because all the fish in those farms will have been eaten. The Farm Land will begin to fail from over utilization. There will be a drastic decline in production followed by a drastic decline in population.

yes, that is what i am saying more or less.

your view is that we will only stop growth when we run out of resources to maintain that growth, a view which is not backed up by the available data.

in north america and europe, our internal population growth (strictly births-deaths, ignoring immigration/emigration) stopped decades ago.  total fertility rates have been below replacement since the mid-60s and show no signs of going back up.  the only thing maintaining total population growth is immigration, and even that is not keeping up in places.  germany, russia, and japan have been experiencing negative population growth for some time.

there's no current shortage of resources to achieve population growth in these areas, but there is no growth happening.  population decline is preceding a resource decline.

Not run out of resources, a drastic decline in resources.


Lets say Data can be looked at in different ways, not to mention we have Macro Example already: Ethiopia. We are just waiting for it to play out on the global scale.

http://www.wilsoncenter.org/index.cfm?topic_id=1413&fuseaction=topics.event_summary&event_id=121044

Ethiopia, followed a pattern that I prescribe.

I also believe the time scale is relatively relevant.

I'm not all doom and gloom, Nature will correct itself. Always has. Just not always in ways we like.

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March 25, 2011, 07:15:55 PM
 #43


Not forgoing, unintended consequences.

Unintended consequences are the natural qualities of technologies.

Quote
Lets assume we develop all that is physically able to be developed by any means necessary. All that is done, has only delayed the inevitable.

What's inevitable? The heat death of the universe? Even if we can't use reason to solve The Final Problem, which is to escape the final state of the universe, life got a very long time to live.

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March 25, 2011, 07:18:25 PM
 #44


I think the jury is still out on genetic engineering. One of the biggest problems is mono-culture, which puts food security at risk. As yet, direct genetic manipulation of food crops can not approach the kind of diversity that natural plant propagation can produce. There is also an issue of risk-diversity by channelizing most all of available plant species for industrial production through a small handful of companies; Monsanto, Cargill, and ADM. This also fails to address market flexibility since these mega-players use limited market channels.

Monsanto and the like utilize monopoly enhancing regulations such as patents to keep a foothold on the market. Previously, people sell new plant varieties without patent and still make lot of money off of it.

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March 25, 2011, 07:21:11 PM
 #45

I believe Efficiency is our enemy. We strive for it, we try to increase production, to maximized everything.

Some of the best dynamic systems are not the most efficient. Nature allowed us to become efficient. It also allowed us to understand efficiency. I think we mis-understood it.

Not wanting to go "Biblical" but a day of rest was a good idea. Utilizing land for 7 years and giving it a year of rest, was limiting efficiency. I think our ancestors understood it better, than us.

We had a built in moral code to not be to efficient. We ignored it.

As far as changing farming for animal feed to human food, animals are part of the system. You have just chosen to not feed them to feed us. What would the outcome of that be? You kind of made my point. We will sacrifice everything for our "perceived" benefit. When in actuality, we just passed the buck to the next generation at the cost of their pain.

As far as genetic engineering, Nature gave us the ability to do it. But it also gave us forethought. Just because something can be done, doesn't mean it should be done. We should examine all possible out comes before going down that road because we are playing chess with Nature, and Nature is a Grand Master at playing chess, compared to us just learning to play. Lets not go Arrogantly into that realm.

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March 25, 2011, 07:26:02 PM
 #46


Not forgoing, unintended consequences.

Unintended consequences are the natural qualities of technologies.

Quote
Lets assume we develop all that is physically able to be developed by any means necessary. All that is done, has only delayed the inevitable.

What's inevitable? The heat death of the universe? Even if we can't use reason to solve The Final Problem, which is to escape the final state of the universe, life got a very long time to live.


If at least one other planet in our solar system was habitable, I would have a lot of enthusiasm.  We need more space. I am all for terra forming. Lets start sending everything to mars to see if anything can take hold in that habitat. Bacteria, what ever.

I would just like our species to be around at the end. Lets reason our way that far. Of course, we will if around and not on a dead end will under go speciation. But that is just our progeny that replaces us.


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March 25, 2011, 07:26:44 PM
 #47

Not run out of resources, a drastic decline in resources.

Lets say Data can be looked at in different ways, not to mention we have Macro Example already: Ethiopia. We are just waiting for it to play out on the global scale.

http://www.wilsoncenter.org/index.cfm?topic_id=1413&fuseaction=topics.event_summary&event_id=121044

Ethiopia, followed a pattern that I prescribe.

I also believe the time scale is relatively relevant.

I'm not all doom and gloom, Nature will correct itself. Always has. Just not always in ways we like.


ethiopa's population situation is exactly opposite of developed countries and the world in general.

ethiopia's growth rate is 2.5% and rising.

the world population growth rate is at 1.1% and dropping.

ethiopia did not experience a slowing growth rate followed by a decline in resources, therefore it is not applicable to the world at large.

I believe Efficiency is our enemy. We strive for it, we try to increase production, to maximized everything.

the fact that we aren't doing that is my entire point.  we are not working on increasing population.  as a side effect of society, we are moving away from population growth.
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March 25, 2011, 07:28:26 PM
 #48


If at least one other planet in our solar system was habitable, I would have a lot of enthusiasm.  We need more space. I am all for terra forming. Let start send everything to mars to see if anything can take hold in that habitat. Bacteria, what ever.

We have plenty of space on earth but our species could be wiped out from a planetary extinction event.
Quote
I would just like our species to be around at the end. Lets reason our way that far. Of course, we will if around and not on a dead end will under go speciation. But that is just our progeny that replaces us.

I intend to live toward the very end and escape the ultimate fate of the universe.

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March 25, 2011, 07:43:59 PM
 #49


If at least one other planet in our solar system was habitable, I would have a lot of enthusiasm.  We need more space. I am all for terra forming. Let start send everything to mars to see if anything can take hold in that habitat. Bacteria, what ever.

We have plenty of space on earth but our species could be wiped out from a planetary extinction event.
Quote
I would just like our species to be around at the end. Lets reason our way that far. Of course, we will if around and not on a dead end will under go speciation. But that is just our progeny that replaces us.

I intend to live toward the very end and escape the ultimate fate of the universe.

Funny, I am waiting for Dr. Who?

Quantify "Plenty of Space"?  Not just occupancy.

I.E.

In India it takes 1.98 acres of land to support a person at there life style.

In the U.S. it takes 25.45 acres to support our lifestyle.

39.8% of the world has agricultural land, or 18545974.7 square miles X 640 = 11869423808 acres

So given 7 Billion people that is: 1.69 acres per person.

The simple math of the matter tells us we are in trouble.

And this is assuming that the Agricultural land can maintain its growth without letting it rest for re-netrialization.

Now, Pick who starves.


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March 25, 2011, 07:48:39 PM
 #50


In India it takes 1.98 acres of land to support a person at there life style.

Are we talking about farms creating food? You do realize that India is becoming rich?

Are you implying that we consume more food?

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March 25, 2011, 08:10:21 PM
 #51

In India it takes 1.98 acres of land to support a person at there life style.

In the U.S. it takes 25.45 acres to support our lifestyle.

39.8% of the world has agricultural land, or 18545974.7 square miles X 640 = 11869423808 acres

So given 7 Billion people that is: 1.69 acres per person.

The simple math of the matter tells us we are in trouble.

And this is assuming that the Agricultural land can maintain its growth without letting it rest for re-netrialization.

Now, Pick who starves.

where are you finding these numbers?

the US has 3.4 acres/person of agricultural land, not 25.  for the 25 to be correct, the US would need to be a net importer of food, which it is not.
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March 25, 2011, 09:06:32 PM
Last edit: March 25, 2011, 09:22:37 PM by wb3
 #52

In India it takes 1.98 acres of land to support a person at there life style.

In the U.S. it takes 25.45 acres to support our lifestyle.

39.8% of the world has agricultural land, or 18545974.7 square miles X 640 = 11869423808 acres

So given 7 Billion people that is: 1.69 acres per person.

The simple math of the matter tells us we are in trouble.

And this is assuming that the Agricultural land can maintain its growth without letting it rest for re-netrialization.

Now, Pick who starves.

where are you finding these numbers?

the US has 3.4 acres/person of agricultural land, not 25.  for the 25 to be correct, the US would need to be a net importer of food, which it is not.

Not how much it has in the U.S. but how much it takes us in the U.S. at our current life styles. Remember we do import food from other countries.

Just a sec and I will post the sources.

I don't know if you have access but the previous information comes from Scholarly research.

Rees Ecological Footprint <-- If you do a Google search and select the Scholarly Research you can get a summary, if you have access to the Research Paper you can read the whole article.

It includes Mathis Wackernagel's PhD studies.

Google lets you read some of it here: http://books.google.com/books?hl=en&lr=&id=N__ujKDfXq8C&oi=fnd&pg=PR9&dq=rees+ecological+footprint&ots=3AP50wlsvY&sig=2FkL4f8ezTq2SzAfVr1XyrpyYFc#v=onepage&q=rees%20ecological%20footprint&f=false

Remember this study is a snap shot in time: It has not gotten better but worse. Technically they should be updated every year. I think wikipedia covers a less scholarly but good information here: http://en.wikipedia.org/wiki/Ecological_footprint




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March 25, 2011, 09:25:16 PM
 #53

Remember we do import food from other countries.

yes, and you export more than that to other countries, as i stated.  agriculture is one of the US economic sectors where there is a trade surplus.
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March 25, 2011, 09:29:23 PM
 #54

There is more space for man under water in Earth oceans than in the rest of solar system.


What do you base this upon?  Are you assuming surface area of geoengineerable planets?  Because I seriously doubt this is accurate.

87.3% of statistics found on Internet forums are made up on the spot.

Quote
Not to mention that energy required to settle oceans is by 2 orders of magnitude less.


Again, based upon what?

"The powers of financial capitalism had another far-reaching aim, nothing less than to create a world system of financial control in private hands able to dominate the political system of each country and the economy of the world as a whole. This system was to be controlled in a feudalist fashion by the central banks of the world acting in concert, by secret agreements arrived at in frequent meetings and conferences. The apex of the systems was to be the Bank for International Settlements in Basel, Switzerland, a private bank owned and controlled by the world's central banks which were themselves private corporations. Each central bank...sought to dominate its government by its ability to control Treasury loans, to manipulate foreign exchanges, to influence the level of economic activity in the country, and to influence cooperative politicians by subsequent economic rewards in the business world."

- Carroll Quigley, CFR member, mentor to Bill Clinton, from 'Tragedy And Hope'
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March 25, 2011, 09:38:11 PM
 #55

I don't understand what wb3 is talking about. It seem that I have to read what ecological footprint means.

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March 25, 2011, 09:54:56 PM
 #56

Remember we do import food from other countries.

yes, and you export more than that to other countries, as i stated.  agriculture is one of the US economic sectors where there is a trade surplus.

I think this is why we will be hurt less. Proximity to food resources will matter more as transportation costs increase. If you read the article, it does show some interesting facts.

This is still all related to inflation. In the U.S. Food prices had the largest jump since 1974. Granted there are many reasons for this, but why just Food that had the largest jump in price? Not cell phones, not cars, not TVs, but Food. There is an underlying cause.

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March 25, 2011, 10:02:02 PM
 #57

This is still all related to inflation. In the U.S. Food prices had the largest jump since 1974. Granted there are many reasons for this, but why just Food that had the largest jump in price? Not cell phones, not cars, not TVs, but Food. There is an underlying cause.

Food and energy both had a large jump.  The prices in consumer products are lagging as compared to oil, because they were made with last summer's oil.  We see the prices in food rise quicker, in part, because nearly everything that we eat takes a great deal of energy to transport from where it is grown, to where it is processed, to where it is sold.  We will see prices rise in consumer goods if the current oil price maintains it's present levels.

"The powers of financial capitalism had another far-reaching aim, nothing less than to create a world system of financial control in private hands able to dominate the political system of each country and the economy of the world as a whole. This system was to be controlled in a feudalist fashion by the central banks of the world acting in concert, by secret agreements arrived at in frequent meetings and conferences. The apex of the systems was to be the Bank for International Settlements in Basel, Switzerland, a private bank owned and controlled by the world's central banks which were themselves private corporations. Each central bank...sought to dominate its government by its ability to control Treasury loans, to manipulate foreign exchanges, to influence the level of economic activity in the country, and to influence cooperative politicians by subsequent economic rewards in the business world."

- Carroll Quigley, CFR member, mentor to Bill Clinton, from 'Tragedy And Hope'
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March 25, 2011, 10:12:49 PM
Last edit: March 25, 2011, 10:35:03 PM by wb3
 #58

This is still all related to inflation. In the U.S. Food prices had the largest jump since 1974. Granted there are many reasons for this, but why just Food that had the largest jump in price? Not cell phones, not cars, not TVs, but Food. There is an underlying cause.

Food and energy both had a large jump.  The prices in consumer products are lagging as compared to oil, because they were made with last summer's oil.  We see the prices in food rise quicker, in part, because nearly everything that we eat takes a great deal of energy to transport from where it is grown, to where it is processed, to where it is sold.  We will see prices rise in consumer goods if the current oil price maintains it's present levels.

That is a reasonable and logical stance:

My position is:

Because of Quantitative Easing (devaluing of the Dollar) by the FED, speculators in the market new of a quick way to make money. People's money won't be able to buy as much, but what must they buy if they have to buy less. (Food). So through the commodity market they speculate the demand for food will rise. There speculation causes the Food price to rise over other products. The Price of Oil surly plays a part in it as does transportation costs.

But Speculators try to predict the future: The smart money says people will have a hard time coming and the demand for food will go up. So far, they are correct. But if they are proven correct, that food out weighs other products for a length of time there is a double edge effect. It will cause great inflation in Food Prices (the absolutely worse place to have inflation) You can deal with inflation in Cars, TVs, Power, Cell Phones, etc... You can not deal well with inflation of food prices.

There is a way of telling which one of our arguments is correct.

Under my theory and model. The following will occur:

Food Inflation, followed by general product Inflation, followed by Increased Food Inflation, which is followed by Non-Necassity Product Deflation.

Basically a split will occur. Necessary products will Inflate in price while Non-necassary products will initially inflate followed by a relatively quick deflation in price.


I really hope your position is the correct one, but I must explore mine.

I tend to think the speculators got it right. If money buys less, speculate the food prices up, to increase profits, which will lead to other products becoming less desirable and decrease in price. Which will lead to more companies going out of business, more unemployment, less money to keep other businesses in the market, etc.... 

I think the world is on the edge of a very unstable cliff and unless managed properly, the fall that must come will hurt many more than it needs to do. Other countries separately in the past have had depressions, I think we are on the verge of our first "global" depression.

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March 26, 2011, 04:26:33 AM
 #59

I always like watching people's heads explode when presented with the 26 acres per capita number.  It's easy to calculate about a half dozen different ways.

But, with regards to the US at least, it's also fairly easy to lower.  Even Europe has a high standard of living with much lower consumption.  And though meat does account for a large acreage, most of it is not food.  Most of it is waste:  driving inefficient cars long distances, temperature control of poorly-insulated buildings (not just houses but shops and warehouses), self-destructing consumer items shipped from the other side of the world, supply-chain waste and a lot of redundant energy consumption on things like frozen foods.  It can be cut in half fairly easily.

But to answer "where does it come from", well, good question because the US only has about 6-7 acres of land per capita.  The rest comes from trade, from oceans, and from fossil fuels.  All of these are threatened for various reasons -- trade due to our own government's incompetence, oceans due to over-utilization and pollution, and fossil fuels due to depletion and negative externalities.  These sources constitute almost 3/4 of the American standard of living.

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